Core Viewpoint - KALA BIO has experienced a bearish trend recently, losing 9% over the past week, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be increasing [1] Technical Analysis - The hammer chart pattern indicates a possible bottom formation, suggesting that selling pressure may be subsiding [1] - A hammer pattern occurs during a downtrend when the stock opens lower, makes a new low, but then closes near or above the opening price, signaling a potential loss of control by bears [2] - Hammer candles can appear on various timeframes and should be used alongside other bullish indicators for confirmation [2] Fundamental Analysis - KALA has seen an upward trend in earnings estimate revisions, with a 1.5% increase in the consensus EPS estimate over the last 30 days, indicating analysts expect better earnings than previously predicted [3] - The company holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [3] - The Zacks Rank serves as a timing indicator, suggesting that KALA's prospects are improving, reinforcing the potential for a turnaround [3]

Company Overview - KALA BIO, Inc. is a clinical-stage biopharmaceutical company focused on innovative therapies for rare and severe eye diseases [3] - The company utilizes a proprietary mesenchymal stem cell secretome (MSC-S) platform for its biologics-based investigational therapies [3] Product Development - KALA's lead product candidate, KPI-012, is designed to address persistent corneal epithelial defect (PCED), a rare disease linked to impaired corneal healing [3] - KPI-012 has received Orphan Drug and Fast Track designations from the U.S. Food and Drug Administration [3] - The company is also exploring KPI-012 for Limbal Stem Cell Deficiency and other rare corneal diseases that threaten vision [3] - Preclinical studies are underway to evaluate the MSC-S platform's potential for treating retinal degenerative diseases, including Retinitis Pigmentosa and Stargardt Disease [3] Upcoming Events - Kim Brazzell, Ph.D., Head of R&D and Chief Medical Officer, will present at the Piper Sandler 36th Annual Healthcare Conference on December 4, 2024 [1] - Management will be available for one-on-one meetings on the same day [1]

Financial Performance - The net loss for the three and nine months ended September 30, 2024, was $9.0 million and $30.3 million, respectively, with an accumulated deficit of $659.7 million as of that date[116]. - Net loss for Q3 2024 was $8.95 million, compared to a net loss of $8.70 million in Q3 2023, an increase in loss of $0.25 million[139]. - Net loss for the nine months ended September 30, 2024, was $30.34 million, a decrease in loss of $3.24 million compared to a net loss of $33.57 million in the same period of 2023[147]. - Grant income for Q3 2024 was $1.9 million, down from $3.0 million in Q3 2023, a decrease of $1.1 million[145]. - Grant income for the nine months ended September 30, 2024, was $4.0 million, up from $3.0 million in 2023, related to the CIRM Award[154]. - Total operating expenses for Q3 2024 were $9.99 million, an increase of $1.23 million compared to $8.76 million in Q3 2023[139]. - Total operating expenses for the nine months ended September 30, 2024, were $31.52 million, an increase of $1.48 million from $30.04 million in the same period of 2023[147]. Research and Development - KPI-012 is currently in Phase 2b clinical development, with topline safety and efficacy data expected to be reported in the second quarter of 2025[110]. - The company has initiated the CHASE trial, which includes approximately 90 patients and aims to evaluate the safety and tolerability of two doses of KPI-012[109]. - The company expects research and development costs for 2024 to be higher than those for the year ended December 31, 2023, due to ongoing clinical development activities[124]. - Research and development expenses for Q3 2024 were $5.17 million, a decrease of $0.39 million from $5.55 million in Q3 2023[142]. - Research and development expenses for the nine months ended September 30, 2024, were $16.84 million, an increase of $2.97 million from $13.87 million in the same period of 2023[149]. - Research and development expenses are expected to increase substantially as Combangio advances the clinical development of KPI-012 and other product candidates[180]. Financing and Cash Flow - The company has incurred significant losses from operations and negative cash flows, financing operations primarily through the sale of its Commercial Business to Alcon and various stock offerings[116]. - The company has paid $2.6 million in cash and $2.4 million in shares of common stock as part of the contingent consideration related to the Combangio acquisition[128]. - The company may be required to pay up to $105.0 million in contingent milestone payments to former Combangio equityholders based on specified development and commercialization milestones[128]. - Net cash used in operating activities for the nine months ended September 30, 2024 was $24.8 million, an increase of $4.6 million compared to the same period in 2023[177]. - Net cash provided by financing activities for the nine months ended September 30, 2024 was $23.2 million, significantly up from $6.0 million in the prior year[179]. - The company entered into a Loan Agreement with Oxford Finance for a term loan of up to $125.0 million, with an outstanding principal balance of $34.0 million as of January 25, 2023[162]. - As of September 30, 2024, the aggregate principal amount outstanding under the Loan Agreement was $34.0 million[191]. - The interest rate on the Loan Agreement changed to a floating rate effective July 1, 2023, with a minimum of 8.00%[191]. Acquisitions and Milestones - The company sold its Commercial Business to Alcon in July 2022 for an upfront cash payment of $60.0 million and is eligible for up to $325.0 million in milestone payments based on future sales of EYSUVIS and INVELTYS[156]. - The acquisition of Combangio includes potential milestone payments totaling $40 million for development and regulatory achievements, and an additional $65 million based on future sales[173]. - Combangio received a $15 million grant from CIRM to support the KPI-012 program, with $5.9 million disbursed in August 2023 and an additional $3.2 million expected in August 2024 upon milestone achievement[172]. Operational Insights - The company has opened 44 trial sites for the CHASE trial in the United States and is expanding to Latin America[109]. - The company expects general and administrative expenses for 2024 to be comparable to those for the year ended December 31, 2023[121]. - General and administrative expenses for the nine months ended September 30, 2024, were $14.14 million, a decrease of $1.80 million from $15.94 million in the same period of 2023[148]. - Interest income for Q3 2024 was $0.57 million, down from $0.70 million in Q3 2023, a decrease of $0.13 million[143]. - Interest expense for Q3 2024 was $1.48 million, slightly up from $1.46 million in Q3 2023[144]. - Interest expense for the nine months ended September 30, 2024, was $4.4 million, compared to $4.3 million for the same period in 2023, with $34.0 million of indebtedness outstanding under the Loan Agreement[153]. Risks and Uncertainties - The company faces significant risks and uncertainties in achieving profitability, with no expected revenue from KPI-012 or other candidates in the foreseeable future[185]. - Future financing needs may require Combangio to raise additional capital through various means, which could dilute existing ownership interests[187]. - The company may need to delay or limit product development if it fails to secure additional funding when needed[189]. - Combangio anticipates that existing cash resources will fund operations into the fourth quarter of 2025, but may not be sufficient for completing clinical development of KPI-012[183]. Compliance and Controls - There were no changes in internal control over financial reporting during the three-month period ended September 30, 2024[194]. - The company’s disclosure controls and procedures were evaluated as effective at the reasonable assurance level as of September 30, 2024[193]. - The company is not currently subject to any material legal proceedings[195].

Financial Performance - KALA BIO reported a net loss of $9.0 million, or $1.93 per share, for Q3 2024, compared to a net loss of $8.7 million, or $3.41 per share, for the same period in 2023[10]. - For the nine months ended September 30, 2024, net loss was $30.3 million, or $8.68 per share, compared to a net loss of $33.6 million, or $14.36 per share, for the same period in 2023[12]. - Net loss for September 2024 was $8,950,000, compared to a net loss of $8,704,000 in September 2023, indicating a slight increase in losses of about 3%[16]. - Net loss per share attributable to common stockholders was $(1.93) for September 2024, compared to $(3.41) for September 2023, showing an improvement of approximately 43%[16]. - Loss from operations for September 2024 was $(9,988,000), compared to $(8,762,000) in September 2023, reflecting an increase in operational losses of approximately 14%[16]. Cash and Expenses - As of September 30, 2024, KALA had cash and cash equivalents of $49.2 million, down from $54.2 million as of June 30, 2024, reflecting cash used in operations[9]. - The company anticipates that its cash resources will fund operations into the fourth quarter of 2025[9]. - Total costs and expenses for September 2024 were $9,988,000, an increase from $8,762,000 in September 2023, representing a 14% rise[16]. - General and administrative (G&A) expenses for Q3 2024 were $4.4 million, down from $5.0 million in Q3 2023, mainly due to a decrease in stock-based compensation and employee-related costs[10]. - General and administrative expenses decreased to $4,400,000 in September 2024 from $4,952,000 in September 2023, a reduction of about 11%[16]. Research and Development - Research and development (R&D) expenses for Q3 2024 were $5.2 million, a decrease from $5.6 million in Q3 2023, primarily due to the timing of manufacturing costs related to KPI-012 development[10]. - Research and development expenses decreased to $5,168,000 in September 2024 from $5,554,000 in September 2023, a reduction of approximately 7%[16]. - KALA continues to enroll patients in the Phase 2b CHASE trial for KPI-012, targeting topline results in Q2 2025[6]. - KALA has initiated five clinical trial sites in Argentina for the CHASE trial, with additional sites in Latin America in progress[6]. - KALA's lead product candidate, KPI-012, is being developed for PCED and has received Orphan Drug and Fast Track designations from the FDA[13]. Market Opportunity - The estimated incidence of Persistent Corneal Epithelial Defect (PCED) in the U.S. is approximately 100,000 patients, representing a significant market opportunity[5]. Income and Shares - Interest income decreased to $570,000 in September 2024 from $708,000 in September 2023, a decline of about 19%[16]. - Grant income for September 2024 was $1,946,000, down from $2,970,000 in September 2023, representing a decrease of approximately 34%[16]. - Total other income (expense) for September 2024 was $1,038,000, compared to $58,000 in September 2023, indicating a significant increase[16]. - Weighted average shares outstanding increased to 4,627,578 in September 2024 from 2,550,210 in September 2023, reflecting a growth of 81%[16].

Core Viewpoint - KALA BIO has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which have a strong correlation with near-term stock price movements [4][6]. - For KALA BIO, the recent upgrade reflects an improvement in the company's underlying business, likely leading to increased stock prices due to investor interest [5][10]. Earnings Estimate Revisions - KALA BIO is expected to earn -$11.76 per share for the fiscal year ending December 2024, representing a 32.2% change from the previous year [8]. - Over the past three months, the Zacks Consensus Estimate for KALA BIO has increased by 18.9%, indicating a positive trend in earnings estimates [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - KALA BIO's upgrade to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Shares of KALA BIO (KALA) have been struggling lately and have lost 17.1% over the past four weeks. However, a hammer chart pattern was formed in its last trading session, which could mean that the stock found support with bulls being able to counteract the bears. So, it could witness a trend reversal down the road. The formation of a hammer pattern is considered a technical indication of nearing a bottom with likely subsiding of selling pressure. But this is not the only factor that makes a bullish case fo ...

Clinical Development - KPI-012 is currently in Phase 2b clinical development for the treatment of persistent corneal epithelial defects (PCED), with topline safety and efficacy data expected in Q1 2025[99]. - The CHASE trial has opened approximately 35 to 40 trial sites in the U.S. and is in the process of initiating sites in Latin America, pending regulatory approval[98]. - The company has ceased development of preclinical pipeline programs unrelated to its MSC-S platform to focus resources on KPI-012[100]. - The company anticipates substantial increases in research and development expenses as it advances the clinical development of KPI-012 and other product candidates[164]. Financial Performance - The company reported a net loss of $9.6 million and $21.4 million for the three and six months ended June 30, 2024, respectively, and an accumulated deficit of $650.8 million as of June 30, 2024[104]. - For the three months ended June 30, 2024, total operating expenses were $9.6 million, slightly up from $9.6 million in the same period of 2023[124]. - The net loss for the three months ended June 30, 2024, was $9.6 million, an improvement of $0.8 million compared to a net loss of $10.4 million in the same period of 2023[124]. - General and administrative expenses decreased to $4.3 million for the three months ended June 30, 2024, down from $5.0 million in the same period of 2023, a reduction of $0.6 million[125]. - For the six months ended June 30, 2024, research and development expenses totaled $11.7 million, an increase of $3.4 million from $8.3 million in the same period of 2023[133]. - Net cash used in operating activities for the six months ended June 30, 2024, was $20.1 million, compared to $17.3 million for the same period in 2023, reflecting an increase of $2.8 million[161]. Funding and Capital - The company has incurred significant losses from operations and negative cash flows, financing operations primarily through the sale of its Commercial Business to Alcon and various stock offerings[104]. - The company raised $75.0 million through the sale of common stock under an at-the-market offering, with 565,974 shares sold prior to the termination of the sales agreement on January 10, 2023[142]. - The company completed a private placement in December 2022, raising approximately $31.0 million through the issuance of common stock and Series E Preferred Stock[151]. - The company plans to finance cash needs through equity offerings, debt financings, and collaborations, which may dilute ownership interests[170]. - The company may need to raise additional capital in the future to advance its business, which could adversely affect its financial condition[172]. Grants and Milestones - The company received a $15.0 million grant from CIRM to support the KPI-012 program, with an initial disbursement of $5.9 million received on August 2, 2023[118]. - Grant income for the three months ended June 30, 2024, was $1.0 million related to the CIRM Award, with no grant income recognized in the same period of 2023[130]. - Grant income for the six months ended June 30, 2024, was $2.1 million related to the CIRM Award, while no grant income was recognized in the same period of 2023[138]. - A grant of $15 million was awarded to the company by CIRM on April 28, 2023, to support the KPI-012 program, with $5.9 million disbursed in August 2023 and an additional $3.2 million expected in August 2024[154]. - The company may be required to pay up to $105.0 million in contingent milestone payments to Combangio equityholders based on the achievement of specified milestones[114]. Cash and Debt Management - As of June 30, 2024, the company had $54.2 million in cash and cash equivalents, an increase from $50.9 million as of December 31, 2023[158]. - The company expects existing cash resources to fund operations into the fourth quarter of 2025, but does not anticipate these resources will be sufficient to complete the clinical development of KPI-012[166]. - The aggregate principal amount outstanding under the Loan Agreement bore interest at a floating rate equal to the greater of 30-day LIBOR or 0.11% plus 7.89% through June 30, 2023[174]. - The interest rate on the Loan Agreement is now a floating rate with a minimum of 8.00% effective July 1, 2023[174]. - The company’s cash equivalents as of June 30, 2024 consisted of money market accounts and U.S. treasury securities with maturities of less than 90 days[173].

Exhibit 99.1 KALA BIO Reports Second Quarter 2024 Financial Results and Provides Corporate Update -- Closed $12.5 million private placement financing led by SR One with participation from ADAR1 Capital Management and another life sciences-focused investor – -- Cash resources of $54.2 million as of June 30, 2024, together with anticipated funding remaining from CIRM award, expected to fund operations into 4Q 2025 – -- Topline data from Phase 2b CHASE trial of KPI-012 for PCED targeted in Q1 2025 – ARLINGTON, ...

-- Closed $12.5 million private placement financing led by SR One with participation from ADAR1 Capital Management and another life sciences-focused investor – -- Cash resources of $54.2 million as of June 30, 2024, together with anticipated funding remaining from CIRM award, expected to fund operations into 4Q 2025 – -- Topline data from Phase 2b CHASE trial of KPI-012 for PCED targeted in Q1 2025 -- ARLINGTON, Mass., Aug. 06, 2024 (GLOBE NEWSWIRE) -- KALA BIO, Inc. (NASDAQ:KALA), a clinical-stage biopharm ...

ARLINGTON, Mass., June 27, 2024 (GLOBE NEWSWIRE) -- KALA BIO, Inc. (NASDAQ:KALA), a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the eye, today announced that it has entered into a securities purchase agreement with a select group of institutional accredited investors for the sale, in a private placement, of shares of its common stock and shares of its Series H Convertible Non-Redeemable Preferre ...